Complaints Against Mortgage Lenders Surged This Year. Here’s How Homeowners Are Taking Action and Getting Answers

A photo to accompany a story about filing complaints against mortgage lenders Courtesy of Destiny Blackmon
Like millions of American homeowners, Destiny Blackmon and her family needed help with their mortgage payments after facing COVID-related employment challenges.
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Like millions of American homeowners, Destiny Blackmon needed help with her mortgage payments after facing COVID-related employment challenges.  

The Blackmon family worked out a forbearance plan with their loan servicer but found the communication process difficult. It was a struggle to get consistent information, Blackmon told NextAdvisor. She was assigned a liaison, but it felt like they were “never available,” nor did they seem to have the correct answers. It didn’t seem like the representatives documented each conversation either, said Blackmon. “I had to retell the story 60 times when speaking to other customer service representatives,” she said 

Eventually, Blackmon filed a complaint with the Consumer Financial Protection Bureau (CFPB), the agency responsible for collecting, monitoring, and responding to U.S. consumer complaints about financial services and products. After filing the complaint, the loan servicer’s corporate office stepped in to give Blackmon more attention and to clarify. “Someone from the executive offices called with sympathetic concern stating that they want to do everything they can to help us,” said Blackmon. 

The Blackmons’ experience wasn’t uncommon. Mortgage complaints hit their highest monthly number in three years in March of 2021— more than 3,400 in that month alone, according to the 2021 CFPB Complaint Bulletin

Forbearance-related complaints might be on the rise, but there are other reasons for mortgage lender complaints. Filing a complaint might help you get a faster response, obtain money that’s owed to you, and even influence broader policy and regulatory actions. 

Let’s take a look at common complaints against mortgage lenders, and how to file a complaint against a mortgage company if you find yourself needing help. 

Typical Complaints Against Mortgage Lenders

Many of the issues reported to the CFPB are related to communication, but others have to do with problems that directly affected customers’ wallets, like over-collecting or misappropriating extra payments. These are  most common mortgage lender complaints according to the CFPB’s Consumer Complaint Database

  • Communication issues related to forbearance
  • Repayment options available at the end forbearance plans
  • Confusion related to mandatory account notices
  • Delays from the servicer with regard to loan modification
  • Over-collecting through accounts designed for taxes and insurance
  • Putting extra payments into an “unallocated funds” bucket rather than applying them to the loan principal

Where to File a Complaint 

One of the best places to file a complaint is with the CFPB. The CFPB has been handling complaints since July of 2011 and was designed to provide regulatory support in a way that protects consumers from predatory practices by financial companies. 

Pro Tip

 Submitting a complaint through the CFPB’s online form can help you get it resolved faster.

When you make a complaint, the CFPB forwards that complaint to the company in question to get a response. On top of that, the agency shares data with other government organizations and reports to Congress. This process can eventually lead to new regulations or prompt changes in the way financial transactions and companies operate. 

The CFPB can also impose fines against offending companies and create rules for how financial companies interact with consumers. Blackmon believes the CFPB complaint platform was an effective avenue to help her reach a resolution with her lender. She compared it to other complaint systems saying they were “cumbersome and outdated.” The CFPB’s complaint system, according to Blackmon, is “streamlined.”

Why You Might Want to File a Complaint

If you are not sure if you should file a complaint or not, know that the CFPB’s history of helping consumers get answers is positive. The CFPB’s 2021 annual report states that in 2020, the bureau sent approximately 85% of its mortgage complaints to companies for review. 98% of the companies responded.

  • 88% of the companies “closed with an explanation” 
  • 2% “closed with an administrative response” 
  • 3% “closed with non-monetary relief” 
  • 4% “closed with financial relief” 

Here are some reasons you may want to file a complaint: 

To Report Issues With Forbearance or Repayment Plans 

Issues around forbearance were a common topic in CFPB 2021 Complaint Bulletin, many of them stemming from miscommunications and confusion. 

Part of the rise in complaints may be due to unclear rules of forbearance programs, according to Casey Fleming, a mortgage advisor, author of “The Loan Guide: How to Get the Best Possible Mortgage,” and founder of, an online mortgage broker. 

Pointing to the CARES Act, Fleming says, “consumers heard about forbearance, and they didn’t fully understand it. It created confusion and a gap between consumer expectations and how mortgage lenders and servicers handled the situation.” 

Many of the complaints about forbearance have to do with repayment plans as borrowers leave the forbearance program or the fact that consumers can’t get a payment plan added to the back end of the mortgage to bring them up to date, Fleming pointed out. “The biggest issue was that [at first] the law said the money could all be due at the end of the forbearance period,” Fleming says. “There’s a big chunk of the money that’s supposed to come through, but the borrower can’t pay it.”

To Fill Communication Gaps

Many complaints centered around the lack of communication about end-of-program options and confusion about different notices. Government-mandated forbearance requirements and deadlines changed a few times — causing confusion between involved parties. Blackmon described her communication experience as “disorganized and inconsistent.”

“Based on complaints and company responses, it appears consumers would benefit from clearer communication from servicers over the phone and in writing,” the CFPB Complaint Bulletin states.

To Speed Up a Resolution

If you’re concerned about how you’ve been treated by a mortgage servicer or lender, filing a complaint with the CFPB can help you get an explanation, or possibly relief. Often, the bureau obtains a response from the company within 15 days. For Blackmon, it took approximately seven days to get a response from her mortgage service after filing a complaint, she says.  

To Get Money That You’re Owed 

There are other issues, though, that could result in receiving some money back. For example, if your servicer has incorrectly applied a payment, is slowing down the paperwork for a mortgage payoff or refinance, or has violated RESPA in a way that costs you money, Fleming suggests filing a complaint to see if you can be compensated. This can be especially important if a mortgage lender is costing you money because of their practices.

How the CFPB Mortgage Complaint Process Works

If you decide to file a complaint with the CFPB, you must first go to their website to submit a complaint. It can all be done online. Here’s what you need to know about submitting a complaint against a mortgage lender:

  1. Submit a complaint here at the CFPB website. You’ll need to provide information about what happened. Include information about dates and amounts involved. Don’t forget to provide the name of the company and upload any documentation that supports your complaint. Blackmon created a paper trail of her conversations with each representative. “It has helped when I needed to prove we hadn’t received certain documents or relay the inconsistencies reps told us about program qualifications.”
  2. CFPB review. Once you submit your complaint, the CFPB will review it. They will forward the complaint to the company or to a different agency that might be able to better assist you. You can get updates on the progress of your complaint by creating an account and logging in with a username and password. 
  3. Response from the mortgage lender. Next, the mortgage lender will respond. The CFPB claims that many companies respond within 15 days. Overall, the whole process can take about 60 days until the company offers a final response to the complaint. 
  4. CFPB publishes the complaint. Your complaint is included in the CFPB’s complaint database. You can give permission to have more details included while your identity and personal information are obscured.
  5. Your review. Finally, you review the company’s final response. You can provide feedback on the company’s response within 60 days.